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Query Answer
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OUR CLIENT (HERE CALLED "A") PROVIDES SERVICE ON COMMISSION BASIS ON BEHALF OF FOREIGN EXPORTER (HERE CALLED "B").

"A" FIND OUT CUSTOMER (SERVICE PROVIDE) FOR "B", AND GET COMMISSION FROM "B" IN US$.

WHEN GOODS RECEIVED IN INDIA BY "C" (CUSTOMER), AND PAYMENT OF GOODS SEND TO "B", TRANSACTION IS CLOSED.

THEREAFTER "A" GENERATES COMMISSION INVOICE AND GET PAYMENT IN US$?

NOW QUESTION IS: - GST APPLICABLE ON COMMISSION INCOME ("A" PROVIDES SERVICE IN INDIA)? Whether it is export of service?

Reply

As per sec 2(13) of IGST ACT 2017 “intermediary” means a broker, an agent or any other person, by whatever name called, who arranges or facilitates the supply of goods or services or both, or securities, between two or more persons, but does not include a person who supplies such goods or services or both or securities on his own account.

Therefore "A" will fall under the above definition.

As per section 8(1) of IGST Act, 2017, supply of services where the location of the supplier and the place of supply of services are in the same State or same Union territory shall be treated as intra-State supply. In case of Intra-state supply of service CGST and SGST should be charged by taxpayer.  

Location of supplier of service : India

Place of supply—Further, as per sec 13 (8) of the IGST Act 2017, Place of supply for the intermediary services shall be the location of the supplier i.e. India (location of A is in India).

The service provided by "A" to "B" does not fall under export of service because place of supply of service should be outside India in case of export of service.

Conclusively "A" should prepare invoice same as in case of intra-sate supply and charge CGST and SGST in the invoice. 

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